Johannesburg - The JSE closed slightly firmer on Wednesday despite renewed worries over the euro zone debt crisis, with a futures close-out today propping up local equities. But, global bourses were generally weaker following the threat of downgrade of Spanish debt.
Banks climbed nearly 2% after RMB Holdings [JSE:RMH] on Wednesday announced a far-reaching restructuring of its banking and insurance interests, Andrew Todd, an equity derivatives trader at Imara SP Reid, said.
The restructuring will see RMBH's investment in FirstRand [JSE:FSR] raised from 30% to 34%, that in OUTsurance from 45% to 90% and its stakeholding in MMI Holdings raised from 18% to 24%. Royal Bafokeng Holdings will gain a 5% interest in RMBH.
At 17:00, the JSE all share index was 0.12% higher, with banks climbing 1.96% and financials rising 0.82%. But industrials fell 0.28%. Platinum stocks gained 1.27%, gold miners rose 0.23% and resources up 0.20%.
The rand was bid at 6.79 to the dollar from 6.80 at the JSE's close on Tuesday. Gold was quoted at US$1,389.00 a troy ounce from US$1 393.60/oz at the JSE's previous close, while platinum was at $1 705.50 /oz from $1,695.50/oz before.
Todd said futures activity supported the local market.
But global markets fell after Moody's Investors Service said it may downgrade its ratings on Spanish government debt and Standard and Poor's Ratings Services lowered its ratings outlook on Belgium to negative from stable.
Early on Wednesday, Moody's placed Spain's Aa1 local and foreign currency government bond ratings on review for possible downgrade.
It said the main triggers for placing the rating on review for possible downgrade were Spain's vulnerability to funding stress given its high refinancing needs in 2011; and a potential further increase in the public debt ratio should the cost of bank recapitalisation prove to be higher than expected so far, whether to meet higher-than-expected asset impairments or simply to retain the confidence of the wholesale markets.
Increased concerns over the ability of the Spanish government to achieve the required sustainable and structural improvement in general government finances given the limits of central government control over the regional governments' finances was another trigger.
Dow Jones Newswires reported that US stocks wavered on Wednesday as worries over the euro-zone debt crisis persist, but data showed US inflation remains tame while New York manufacturing conditions improved.
The Dow Jones industrial average edged up 8 points, or 0.1%, to 11 484, a day after the measure reached its highest close since September 2008.
Investors' worries about the euro-zone debt crisis continued to grow as Moody's said it may downgrade its ratings on Spanish government debt and Standard and Poor's Ratings Services lowered its ratings outlook on Belgium to negative from stable.